. /.  WORLD TRADE  
ORGANIZATION  G/STR/Q1/USA/8 
4 February 2005 
 (05-0453) 
Working Party on State Trading Enterprises Original:   English 
  
 
STATE TRADING 
 
Replies to Questions Posed by AUSTRALIA
1 Concerning the  
New and Full Article XVII Notification of the UNITED STATES2 
 
 
 The following communication, dated 2 February 200 5, is being circulated at the request of the 
Delegation of the United States.  
_______________ 
 
 
Q: If as indicated in document G/STR/N/ 4/USA the US Department of Agriculture’s 
Commodity Credit Corporation (CCC) has not ma de any direct export sales since 1995, has the 
United States given any consideration to winding back the CCC’s right to do so? 
 Reply
 
  Under WTO commitments the United States is e ligible to subsidize a specified quantity of 
agricultural products.  Traditionally, direct e xport sales have been export subsidy mechanisms 
employed by the United States.  Australia is correct  that the CCC has not made any direct export sales 
since 1995, and that is why the US notification to  the Working Party on State Trading Enterprises 
does not report such activity.  Issues relating to fu ture activities of the CCC are beyond the scope of 
the review process in this Working Group and w ill depend on the outcome of the Doha negotiations 
on agriculture.      
Q: We understand that the CCC is indirectly in volved in export sales through the donation 
of CCC stocks to other governments, private vo luntary organizations, and US cooperatives 
which are subsequently sold into commercial ma rket (i.e. the monetization of food aid.) 
  - Could the United States provide the most  recent data available on the quantity 
and value of CCC stocks that have been sold in this manner? 
 
Reply
 
  Despite the efforts of the United States and some other countries, food aid requests are still 
substantially in excess of food aid deliveries.  Under the US food aid system, the CCC is the 
government agency that purchases products for food aid deliveries.  This function has to do with food 
aid operations, which are under discussion in the Committee on Agriculture.      
                                                     
 
1 G/STR/Q1/USA/7. 
2 G/STR/N/4/USA. G/STR/Q1/USA/8 
Page 2  
 
 Q: Australia understands that American agric ultural cooperatives are afforded certain 
legal protection by the Capper-Volstead Act from antitrust laws. 
 
 - Could the United States please explain why it does not notify as state trading 
enterprises major exporting agricultural c ooperatives such as CH Inc. (formerly 
Cenex Harvest States Cooperatives) which enjoy special privileges of immunity 
from competition law under the Capper-Volstead Act? 
 
Reply
 
 
 The Capper-Volstead Act has no specific rela tion to import or export markets, and the 
agricultural cooperatives covered by the Act are priv ately owned and operated enterprises.  The Act 
was enacted to give individual farmers, "through agricultural cooperatives ac ting as entities, the same 
unified competitive advantage–and responsib ility–available to businessmen acting through 
corporations as entities".  Maryland & Virginia Milk Producers Association v. United States , 362 US 
458, 466 (1960).  The Act’s exemption is limited.  It extends only so far as to permit cooperation 
between producers of agricultural products in coopera tives, so that they may jointly process, prepare 
for market and market their products.  It does not cover external acts that aim to interfere with 
competitive rivals.  Finally, the Act itself prohib its a cooperative from monopolizing or restraining 
trade "to such an extent that the price of any agricultural product is unduly enhanced."    Q: Can the US provide details on the number of entities which receive immunity from antitrust laws under the Capper-Volstead Act and the quantity of agricultural production 
exported overseas by these entities?  
Reply
 
 
 This information is not collected by the United States government3, and there is no specific 
relationship between the Capper-Vol stead Act and trading activities.  
 
 
__________ 
 
 
                                                      
3 A private association, the National Council of Farm er Cooperatives, has the following information on 
its website: "There are estimated to be over 40,000 coope ratives in the United States… In agriculture, there are 
nearly 3,000 farmer cooper atives [this figure includes cooperatives not within the jurisdiction of Capper 
Volstead, such as credit cooperatives],  whose members include a majority of our nation's 2 million farmers and 
ranchers" . http://www.ncfc.org/info/facts/whatiscoop.shtml